afp ctp practice test

Which of the following is a characteristic of giro systems used in countries in Europe?

• A. They operate through their postal systems.
• B. They are primarily used for company-to-company payments.
• C. They do not replace checks for the payment of bills.
• D. They do not allow the use of direct debits and credits.

Netting is used by which of the following as a cross-border payment technique?

• A. European giro providers
• B. Foreign subsidiaries of a company
• C. Counterparties in a letter of credit transaction
• D. TARGET participants

In which of the following international cash management methods is title for goods transferred for
intercompany sales?

• A. Pooling
• B. Internal factoring
• C. Multilateral netting
• D. Re-invoicing

A company is based in the United States and has an operating subsidiary in Germany. With a stable
U.S. dollar and a depreciating euro, the company's cash manager may elect to:

• A. pool excess funds in the United States to offset German deficits.
• B. implement a dollar-based multilateral netting system.
• C. start leading receivables from the German subsidiary.
• D. establish a multicurrency account in the United States.

Account analysis statements should be examined for which of the following reasons?
I . To verify volumes processed
II . To determine daily cash shortages
III . To verify the accuracy of bank service charges
IV . To ensure that company-initiated transactions have occurred

• A. I and IV only
• B. I and III only
• C. II and III only
• D. II and IV only

An optimal concentration system minimizes all of the following EXCEPT:

• A. administrative costs.
• B. disbursement float.
• C. excess balances.
• D. transfer costs.

A bank issues a letter of credit (L/C) and receives a request for payment under the L/C. The buyer
notifies the issuing bank not to make payment because there is a dispute over the quality of the
merchandise. However, the documents received fully comply with the terms of the L/C. Which of the
following statements is true?

• A. The buyer may immediately return the merchandise and cancel the L/C.
• B. The bank may delay payment until reimbursed by the buyer.
• C. The bank may delay payment, provided the seller is notified of the dispute within three business days.
• D. The bank must make payment and is entitled to immediate reimbursement from the buyer.

The KEY decision in using CCD+ and CTX formats for B2B payments is:

• A. whether to keep the payment and remittance information together or separate.
• B. whether to use the Internet or an EDI spoke to transmit electronic payments.
• C. whether to use an EDI or a UN/EDIFACT protocol to transfer the value electronically.
• D. whether an evaluated receipts or paid-on-production technique is being used for the transfer.

Which one of the following ties a user’s private key to a user’s public key?

• A. A digital signature
• B. A digital certificate
• C. A digitized signature
• D. A digital token

A French company conducts business strictly within the euro zone (the EMU). Which type of risk is of
LEAST concern?

• A. Terrorist
• B. Regulatory
• C. Payment
• D. Currency